China Caves, Promises to Open Entertainment Market by 2011

Finally reacting to a World Trade Organization (WTO) ruling from last year, which denied its attempt to limit foreign media imports in order to protect “public morals,” China has now acquiesced to opening its entertainment goods market by March 19, 2011.

A Reuters story noted that the WTO did not question the right of Chinese officials to censor content, but argued that they “could not use censorship to justify illegal trade barriers,” an argument which the WTO now appears to have won. It was previously stated that that the removal of Chinese restrictions to import would, “be a boon to Western makers of movies, music and video games who currently face extra costs and obstructions to distribute in China.”

It was previously suggested that the agreement may not impact the number of foreign films allowed import into China however, a figure currently limited to 20 per year.

The full text of the agreement, signed by Chinese Representative Sun Zhenyu, and his American counterpart Michael Punke, read:

We wish to inform you that, pursuant to Article 21.3(b) of the Understanding on Rules and Procedures Governing the Settlement of Disputes, China and the United States have agreed that the reasonable period of time for China to implement the recommendations and rulings of the Dispute Settlement Body ("DSB") in the dispute China – Measures Affecting Trading Rights and Distribution Services for Certain Publications and Audiovisual Entertainment Products (WT/DS363) shall be 14 months from the 19 January 2010 date of adoption of the DSB recommendations and rulings.  Accordingly, the reasonable period of time expires on 19 March 2011.